Obbligazioni societarie Telecom equipments: Alcatel-Lucent, Ericsson e le altre. (1 Viewer)

[lorenzo63]

Alcatel Lucent

PARIS -- Telecommunications-equipment maker Alcatel-Lucent SA said its net loss widened in the first quarter, as sales fell in the U.S. and in some of its most profitable businesses.

For the three months ended March 31, Alcatel's loss widened to €402 million ($538.8 million) from €181 million the previous year. The bottom line was weighed down by charges on some of the assets the company acquired as a part of the $11.6 billion merger of France-based Alcatel and U.S.-based Lucent in 2006. The results were also hit by the strengthening dollar, which increased some costs.

Revenue fell 6.9% to €3.6 billion. Sales declined in the core carrier division, which includes mobile and fixed line equipment.

Alcatel has been hurting from weakening demand for network equipment from the telecommunications operators that make up its core customer base, as they struggle with increased competition, tough regulatory pressure and the impact of the economic crunch. Companies such as Vodafone Group PLC are cutting capital expenditure to preserve cash flow, and Deutsche Telekom AG recently issued a surprise profit warning and said it would freeze capital expenditure.

"While expected, given seasonality and tough market conditions, we are not pleased with the operating loss incurred in the first quarter," Chief Executive Ben Verwaayen said in a statement.

Still, the CEO confirmed that he expects the company to return to a profit during the second half of 2010. The company signed $1.7 billion in deals in China last week.

For 2009, Alcatel expects the global telecommunications-equipment market and related services to be down between 8% and 12% at constant currencies.

The first-quarter figures "highlight a difficult year to come and show that management's '09 guidance will be difficult to meet," said Bernstein analyst Pierre Ferragu.

However, Mr. Verwaayen said he hasn't observed a deterioration of the market environment over the past three months and that the telecommunications market was still resilient. Alcatel Lucent also said it should achieve plans to cut €750 million in costs by year end. The company said it booked a €560 million restructuring charge linked to the Alcatel-Lucent merger in 2008 and will likely post a similar charge in 2009.

The company said it generated a negative operating cash flow of €43 million during the quarter, while net debt grew to €841 million at the end of March from €389 million at the end of 2008.

By the end of March, Alcatel-Lucent had a €545 million deficit for pensions and other post-employment benefits, compared with a €429 million deficit at the end of December 2008.

The company said it carried out a debt repayment of €777 million over the first quarter and that the sale of its 20.8% stake in Thales SA to Dassault Aviation SA for €1.6 billion should be completed soon.

"Alcatel-Lucent remains adequately funded," Mr. Verwaayen said, adding that a capital increase wasn't needed at this stage. "We have won some massive deals recently but there is lots of work we still need to do."

 

[Alobar]

Ericsson: - 56% utili trimestre

2009-07-24 12:22 Ericsson: - 56% utili trimestre Causa perdite nei comparti dei cellulari e semiconduttori (ANSA) - ROMA, 24 LUG - Ericsson ha chiuso il secondo trimestre fiscale con un utile netto in calo del 56% su base annua e sotto le attese degli analisti. La causa sono state le perdite nelle sue joint venture nei comparti cellulari e semiconduttori. La societa' svedese e prima costruttrice di reti di telefonia mobile, ha avuto un utile netto di 831 mln di corone (78,1 mln di euro), 26 cent ad azione, contro gli 1,9 mld di corone(59 cent/azione) registrati un anno fa. La previsione media era di 2,1 mld
http://www.ansa.it/site/notizie/awnplus/economia/news/2009-07-24_124364893.html

 

[Alobar]

Ericsson conquista gli asset Nortel per la telefonia 3G

Ericsson mette le mani su una delle divisioni più interessanti, da un punto di vista strategico, di Nortel, gruppo specializzato in networking finito in bancarotta. La società svedese di sistemi di rete, infatti, ha vinto all'asta fallimentare il business che produce apparati per la telefonia mobile aderenti agli standard Cdma (Code Division Multiple Access, cioè accesso a divisione di codice, ovvero la tecnica alla base dell'Umts) e Lte (Long Term Evolution).
La vendita, che dovrà essere approvata dai tribunali fallimentari negli Usa e in canada, ha un valore di 1,13 miliardi di dollari ha visto Ericsson prevalere sulla rivale Nokia Siemens e sull'investitore Matlin Patterson, che peraltro è tra i maggiori creditori di Nortel. Con quest'operazione, Ericsson potrà incrementare con forza la sua presenza negli Stati Uniti: infatti il business legato allo standard Cdma, nel 2008, ha generato ricavi per circa 2 miliardi di dollari. A fronte di un giro d'affari della filiale americana di Ericsson che, sempre nello scorso esercizio, si era attestato a quota circa 2,7 miliardi. Insomma, le revenues del gruppo svedese di telefonia potrebbero quasi duplicarsi.

Ma non è solo una questione di soldi puri e semplici. L'accordo, infatti, permetterà a Ericsson di acquisire i contratti Cdma con operatori quali Verizon e Sprint. Senza contare, poi, i brevetti sull'Lte, long-term evolution, un'innovativa tecnologia per la trasmissione a banda larga. E
che consentirà il trasferimento dati a una velocità pari a 100 Mbps.

Secondo quanto prevede l'accordo almeno 2.500 impiegati di Nortel che lavorano nel settore Cdma e Lte riceveranno un'offerta di lavoro da parte di Ericsson.Il gruppo canadese Nortel cederá al gruppo svedese Ericsson asset per 1,13 miliardi di dollari.
È quanto annuncia Nortel in un comunicato al termine di una gara che Ericsson si è aggiudicata. Il colosso dei Tlc svedese rileverà alcuni asset di telefonia mobile di Nortel e le tecnologie Cdma . L'operazione è sottoposta al via libera delle autorità statunitensi e canadesi. Secondo quanto prevede l'accordo almeno 2.500 impiegati di Nortel che lavorano nel settore Cdma e Lte riceveranno un'offerta di lavoro da parte di Ericsson. Cdma è la tecnologia cellulare digitale di terza generazione più comune e più recente anche nel Nord America. A differenza dei sistemi più vetusti che utilizzano il Tdma, come ad esempio il Gsm, il Cdma non assegna una frequenza specifica all'utente, ma ogni canale impiega tutto lo spettro disponibile. Lte, invece, è una tecnologia che consentirà il trasferimento dati a una velocitá pari a 100 Mbps.
25 luglio 2009


http://www.ilsole24ore.com/art/Sole...09-11de-9aa7-2887d12b6f5c&DocRulesView=Libero

 

[Imark]

Occhio però: il calo dell'utile netto è dovuto ai costi del piano di ristrutturazione già annunciato da Ericsson a gennaio, per cui il mercato li ha già scontati, e non possono certo ritenersi inattesi.

Se invece si guarda al dato dell'EBIT (operating profit, come è definito nell'articolo) questo risulta in crescita su base annua, e non di poco.

Circa le perdite delle jv, la perdita di Sony Ericsson è più che dimezzata rispetto a quella registratasi nel trimestre precedente, segno che gli sforzi di razionalizzazione condotti in quel contesto stanno generando risultati.

Importante è poi il margine lordo, in leggero calo ma cmq su livelli di tutto rispetto proprio nell'attività primaria...

• JULY 24, 2009, 4:05 A.M. ET

3rd UPDATE: Ericsson 2Q Pft Dn On Charges, Shares Slump

By Gustav Sandstrom

Of DOW JONES NEWSWIRES

STOCKHOLM (Dow Jones)--Shares in L.M. Ericsson Telephone Co. (ERIC) fell sharply Friday after it said the economic downturn is now hurting some of its markets and net profit fell by more than half in the second quarter, weighed by restructuring charges and losses at its joint ventures.

At 0802 GMT, Ericsson was the biggest faller on the Stockholm market, trading down SEK6.30, or 8.1%, at SEK71.20 and underperforming a 1.1% drop in the benchmark OMXS30 index.

"The effects of the global economic climate on the mobile infrastructure market are now more notable, especially in markets with currencies under pressure and a tougher credit environment," said Chief Executive Carl-Henric Svanberg.

"At the same time the consumer demand for new services and broadband capabilities are quickly accelerating," he added.

Ericsson, the world's largest telecommunications network company by sales, said second-quarter net profit fell to 831 million Swedish kronor ($111 million) from SEK1.90 billion, well below analysts' expectations for SEK1.58 billion.

The company booked restructuring charges in the period of SEK3.6 billion, losses of EUR213 million at Sony Ericsson, its handset joint venture with Japan's Sony Corp. (SNE), and losses of $213 million for ST-Ericsson, its semiconductor tie-up with STMicroelectronics (STM).

Operating profit excluding joint ventures was SEK6.9 billion, up from SEK4.7 billion.

Ericsson's report comes after Finnish rival Nokia Siemens Networks, a joint venture of Nokia Corp. (NOK) and Siemens AG (SI), last week posted a wider second-quarter operating loss of EUR188 million and forecast that infrastructure markets would shrink 10% in 2009 from 2008.

Several telecom operators have announced plans to reduce investments in order to maintain cashflow in the economic downturn, a trend that can hurt companies like Ericsson that supply network equipment. On Thursday, Norway's Telenor ASA (TEL.OS) cut its 2009 guidance for capital expenditure as a proportion of revenue to 13%-15% from 15%-17%. Earlier this week, Swedish operator Tele2 AB (TEL2-B.SK) also said it would scrutinize its operational and capital expenditure.

However, Ericsson has recently signed a substantial number of service contracts with companies including Sprint Nextel Corp. (S) and Vodafone Group PLC (VOD), which to some extent have compensated for operators' cautious capital investment. Earlier this month it also signed deals totaling $1.7 billion to deliver second- and third-generation mobile communications equipment to China Mobile Communications Corp. and China Unicom.
Western gear companies Ericsson, NSN and Alctatel-Lucent (ALU) have been fighting for market share in China, where there is rapid growth, but face stiff competition from local rivals such as ZTE Corp (000063.SZ) and Huawei Technologies.

Ericsson's second quarter restructuring charges related to its previously announced cost-cutting plan. The company in January announced a savings plan which it said would lead to restructuring charges of SEK6 billion-7 billion and annual cost reductions of SEK10 billion by the second half of 2010.

Second-quarter sales increased 7% to SEK52.14 billion, against expectations for SEK53.62 billion. Operating profit was SEK1.21 billion, down from SEK2.89 billion the year before and below expectations for SEK2.21 billion.

The weaker Swedish krona boosted income, but the effect was partly offset by currency hedging losses, Ericsson said.

Diluted earnings per share fell to SEK0.26 from SEK0.59, missing expectations for SEK0.50.

The gross margin fell to 33.8% from 35.7%, against expectations for 35.5%.

The report was mixed, according to Redeye analyst Greger Johansson, who has a hold rating on the share. Johansson noted the strong result from the service segment, but said there is weakness at the dominant networks unit. He also noted that Ericsson is now feeling the pinch of the economic slump in some markets, where previously it said these effects were limited. Still, he said the much weaker-than-expected net profit mainly reflected one-off charges and weak results at Ericsson's joint ventures, and shouldn't therefore be too worrying for investors

 

[Imark]

Alcatel Lucent in leggero utile sull'effetto della vendita della propria quota in Thales a Dassault.

Ha comunque grandemente ridotto la propria perdita operativa rispetto a quella di un anno fa, valuta la dismissione di altri asset ritenuti non strategici e conta di raggiungere un punto di pareggio nei conti nell'anno in corso - lavorando ancora sulla struttura dei costi e con un mercato per il quale stima nel 2009 un calo compreso fra l'8% ed il 12% - per poi divenire leggermente profittevole nel 2010 e migliorare ulteriormente nel 2012.

• JULY 30, 2009, 6:48 A.M. ET

2nd UPDATE: Alcatel-Lucent Swings To 2Q Net Pft, Shares Soar

(Adds background, detail, comment.)
By A.H. Mooradian
Of DOW JONES NEWSWIRES

PARIS (Dow Jones)--Franco-American telecommunications technology group Alcatel-Lucent SA (ALU) Thursday said it swung to a second quarter net profit on gains from asset sales and after a big impairment charge last year, and reiterated that it expects to improve its full-year operating result.

Net profit in the quarter ending June 30 was EUR14 million, from a EUR1.1 billion loss in the same quarter a year earlier when there was a EUR810 million impairment charge on part of its wireless business. Alcatel Lucent also booked EUR277 million in exceptional gains, the biggest of which was a tax-free EUR255 million capital gain from the sale of its stake in French defense and aerospace electronics group Thales SA (HO.FR) to aerospace group Dassault Aviation SA (AM.FR).

The results beat analysts' expectations for a net loss of EUR169 million, despite a 4.8% fall in revenue. The surprise net profit, and the company's reiteration that it expects to break even for the full year on an adjusted operating level, pushed Alcatel Lucent's share price sharply higher. At 1015 GMT, the share rose EUR0.12, or 6.5%, to EUR1.92, having traded as much as 10% higher shortly after the open.

On an adjusted operating basis, it posted a loss of EUR62 million for the quarter ending Jun. 30. It didn't provide a year-ago figure. The figure is adjusted to exclude the main impacts from the purchase price allocation related to the former Lucent Technologies, with which Alcatel merged in 2006 to create Alcatel-Lucent.

Alcatel-Lucent said Thursday it is evaluating the potential sale of other non-core assets.

"Operationally, we are seeing positive trends in our top-line, gross margin and operating expenses," Chief Executive Ben Verwaayen said in a statement, but he said market conditions remain difficult and telecommunications operators continue to be selective about investments.

Alcatel-Lucent has suffered from weakening demand for network equipment from telecommunications operators that make up its core customer base and which are struggling with increased competition, tough regulatory pressure and the economic crunch.

Rivals are also feeling the pressure. L.M. Ericsson Telephone Co. (ERIC), the world's largest network equipment company by sales, last week reported second-quarter net profit fell 56% to 831 million Swedish kronor ($111 million), well below analysts' expectations for SEK1.58 billion.

And Nokia Siemens Networks, a joint venture of Nokia Corp. (NOK) and Siemens AG (SI), said its second-quarter operating loss widened to EUR188 million and it forecast network infrastructure markets will shrink 10% in 2009.

Revenue pressures on these three big equipment makers are also increasing amid strong competition from Chinese equipment suppliers ZTE Corp (000063.SZ) and Huawei Technologies, which are now major global forces. China is one of the remaining areas where there is major growth. ZTE and Huawei are both expected to grow their global market share.

The 2006 marriage of Alcatel and Lucent Technologies has weighed heavily over the company, in part due to culture clashes between the French and U.S. sides of the business.

Under Verwaayen, formerly CEO of BT Group PLC (BT), the company is trying to claw its way back to profitability.

A day ago, French industry minister Christian Estrosi said the Alcatel-Lucent merger was a mistake that made the company more fragile. But Verwaayen said Thursday the company's transformation is on track.

Still, for now the market view is cautious. "We reiterate our view that our addressable market should be down between 8% and 12% at constant currency in 2009," he said. "As we look forward to the second half, we expect to achieve our target of an adjusted operating income around break-even through further improvement in our margins and expense structure."

Verwaayen said he still needs another one or two quarters to get better visibility of the business trend in 2010. He reiterated Alcatel-Lucent expects to be moderately profitable next year and back to normal in 2011

 

[paologorgo]

piccola acquisizione:

Alcatel-Lucent Acquires CDN Technology Provider Velocix


This morning, Alcatel-Lucent (ALU) announced it has acquired CDN technology provider Velocix. As I reported two months ago, Velocix had been in talks with various companies about being acquired and the deal with Alcatel-Lucent closed five days ago. Terms of the deal were not announced and while I have not spoken to anyone yet who can confirm my estimate, my guess would be the deal size was around $20-$25M. To date, Velocix, formerly known as CacheLogic, had raised over $50M spent about $25M, from at least four rounds of funding and was doing well under $10M a year in sales.
For Alcatel-Lucent, this acquisition was purely a technology one to get their hands on Velocix's Metro product line and they didn't acquire the company for their revenue. Velocix's Metro product will not be bundled into Alcatel-Lucent's offering and will directly target service providers like Verizon, who are some of Alcatel-Lucent's largest customers.
The Velocix Metro product will fall under the IP division at Alcatel-Lucent which reports into Steve Vogelsang, VP Of Business Strategy. I had a chance to speak to Steve yesterday about the deal and he mentioned that while it's too early for the company to comment on everything they plan on doing with Velocix's technology, they do see this as natural fit for their service provider business. Steve said that, "many of our customers and service providers have been evaluating their CDN strategy and the Metro is a really well thought out product for what the service providers need." Steve said the immediate goal is to take the Velocix product offering, productize it and start offering it to their largest customers.


http://blog.streamingmedia.com/the_...acquires-cdn-technology-provider-velocix.html

 

[Imark]

Se la gioca attorno del 50% circa le possibilità di superare la congiuntura attuale senza ristrutturare il debito ...

Dipende anche da un eventuale intervento dello Stato francese... peccato perché anche qui, come in altri casi, si è sprecato tempo.

Insistono sulla possibilità di accedere al mercato obbligazionario, ove volessero, e sulla possibilità di emettere un bond cv, ma soprattutto sulla possibilità di ricavare molto cash per tramite della dismissione di asset non strategici (che tuttavia non sono stati indicati).

• JULY 30, 2009, 8:11 A.M. ET

Alcatel-Lucent CFO: Asset Sales Could Raise Significant Cash

PARIS (Dow Jones)--Franco-American telecommunications network and equipment group Alcatel-Lucent SA (ALU) has numerous non-core assets it could sell and the company has the potential to raise significant cash through such sales, Chief Financial Officer Paul Tufano said Thursday.

What assets might be sold depends upon trends in the markets and what opportunities arise, Tufano told an analyst meeting.

Earlier Thursday, the company said it is evaluating more disposals of non-core assets.

Tufano and Chief Executive Ben Verwaayen repeatedly declined to comment on which operations might be up for sale.

Tufano did say the company holds numerous assets which have no relationship to the company's core telecommunications business.

He repeated comments made earlier Thursday that the company is adequately funded, but would consider issuing a convertible bond given the right opportunity.

He said credit markets have loosened recently and there is nothing structural at the company to prevent it from tapping the market.
Company Web site: www.alcatel-lucent.com

 

[Imark]

Posto il commento di Fitch sull'acquisizione degli asset di Nortel e sui dati del trimestre ultimo diffusi giorni addietro.

Importante monitorare i livelli di liquidità di Ericsson, tenendo d'occhio anche l'andamento delle due jv con Sony ed Stmicro.

Fitch:No Immediate Impact from Nortel Deal on Ericsson's Rtg; Potential Cash Calls from JVs in Focus

27 Jul 2009 11:17 AM (EDT)

Fitch Ratings-London-27 July 2009: Fitch Ratings today said it sees no immediate impact on Sweden-based Telefonaktiebolaget LM Ericsson's (Ericsson) Issuer Default rating (IDR) and senior unsecured 'BBB+' ratings following the weekend announcement of the agreement to buy the majority of Nortel's North American wireless business.

The transaction will, however, reduce the company's net cash position and near-term flexibility to deal with any potential cash call from joint ventures.

"The level of interest, including bids from Finland's Nokia, private equity and Canada's Research in Motion appears to underline the value in these assets," said Stuart Reid, a Senior Director in Fitch's European TMT group.

"However, the agreed price of USD1.13bn will reduce Ericsson's liquidity headroom in the near term. While underlying performance from the core networks business is relatively solid, Fitch does not discount the possibility of potential cash calls from either of the company's joint ventures - namely Sony Ericsson and ST-Ericsson."

In Fitch's view, the acquisition of Nortel's North American CDMA will add significantly to Ericsson's market share and scale in North America, following the company's managed service contract recently signed with Sprint.

The CDMA business generated USD2bn in 2008 sales compared with Ericsson's USD2.7bn 2008 sales in the (N. America) region. While over time CDMA as a technology will decline in importance, the acquisition includes Nortel's LTE (long term evolution) business, providing a technology migration path for these CDMA customers. Customer contracts included in the agreement include those with Verizon, Sprint, US Cellular, Bell Canada and Leap.

On a pro-forma basis (taking Ericsson's Q209 net cash position of SEK27.9bn) the cash transaction will reduce net cash to around SEK19.5bn, but still some way above the SEK15bn that Fitch considers might generate concern in terms of the strength of liquidity at the current ratings.

As the transaction is subject to necessary approvals from the US and Canadian bankruptcy courts and regulators, Fitch believes Ericsson also has time to rebuild its net cash position from free cash flow.

In Fitch's view, Ericsson's Q209 results, published last week, were solid, with revenue growth (assisted by currency effects) and good margin progress (excluding restructuring) recorded at each of the Networks, Professional Services and Multimedia divisions.

Its outperformance relative to the industry underlines the benefit of the scale of Ericsson's mobile network. Ericsson's cash flow performance at group level was relatively solid, with pre-distribution free cash flow (FCF) performance (on an LTM basis) continuing to meet Fitch's rating driver of 4%-5% (pre-distribution FCF/sales).

A wider concern is, however, whether either of Ericsson's joint venture investments could call on shareholders for further capital later in the year.

Neither Sony Ericsson nor ST-Ericsson is performing well at present, amid weak market conditions and, in the case of Sony Ericsson, a loss of handset market share.

Sony Ericsson, however, reported net cash of EUR965m at Q209, down from ER1.1bn at Q109, while both Ericsson and Sony Ericsson have commented on the venture's ability to raise (debt) funds in the market without recourse to shareholders.

ST-Ericsson had net cash of USD326m at Q209, compared with USD358m reported at Q109. Cash burn therefore appears to be reasonably controlled. Fitch will continue to monitor the company's liquidity and signs of stabilization in the JVs' end-markets in coming quarters.

 

[Imark]

Se la gioca attorno del 50% circa le possibilità di superare la congiuntura attuale senza ristrutturare il debito ...

Dipende anche da un eventuale intervento dello Stato francese... peccato perché anche qui, come in altri casi, si è sprecato tempo.

Insistono sulla possibilità di accedere al mercato obbligazionario, ove volessero, e sulla possibilità di emettere un bond cv, ma soprattutto sulla possibilità di ricavare molto cash per tramite della dismissione di asset non strategici (che tuttavia non sono stati indicati).
,,,,

Ce l'hanno fatta ad emetterlo il bond cv, circostanza questa che gioverà alla situazione della liquidità nel breve termine, ma che diluisce il recovery in caso di default dei bond già in essere secondo S&P, che di conseguenza ne riduce il recovery rating.

L'agenzia resta incerta circa il possibile futuro andamento di Alcatel-Lucent e molto dipenderà dal successo della ristrutturazione in essere (con le 4 precedenti tutte non andate a buon fine) che, dovesse non dare esiti in termini di miglioramento dei margini operativi o essere vanificata da un calo del fatturato superiore alle attese, porterebbe all'ennesimo downgrade da parte di S&P già nel 2009 o ad inizio 2010, nonostante il miglioramento contingente della posizione di liquidità...

[FONT=Arial, Helvetica, sans-serif]Alcatel Lucent 'B+/B' Ratings Affirmed On New Convertible Issue Rated 'B+' With '4' Recovery Rating; Outlook Negative[/FONT]

• French telecom equipment supplier Alcatel Lucent today launched an €870 million convertible debt issue, which we expect will likely further
  support the company's liquidity.
• We are affirming the 'B+' long-term corporate credit rating on Alcatel Lucent.
• We are assigning a 'B+' rating, with a '4' recovery rating, to the new convertible bond; we are lowering the recovery rating on Alcatel's previously existing senior unsecured debt, still rated 'B+', to '4' from '3'.
• The negative outlook continues to reflect our views regarding Alcatel Lucent's operating performance.

PARIS (Standard & Poor's) Sept. 2, 2009--Standard & Poor's Ratings Services today said it has affirmed its 'B+/B' long-term and short-term corporate credit ratings on French telecommunications equipment supplier Alcatel Lucent. The outlook is negative.

At the same time, we assigned a 'B+' issue rating to Alcatel Lucent's senior unsecured convertible bond issue announced today, in line with the corporate credit rating. We also assigned a recovery rating of '4' to this bond, reflecting our expectations for average (30%-50%) recovery in the event of a payment default.

In addition, we lowered the recovery rating on Alcatel Lucent's previously existing senior unsecured debt, rated 'B+', to '4' from '3.

The 'B+' rating on unsecured debt issued by Alcatel-Lucent USA Inc. (B+/Negative/--; formerly Lucent Technologies Inc., a subsidiary of Alcatel Lucent) remains unchanged, as does the '4' recovery rating on this debt.

"Our affirmation follows Alcatel Lucent's launch today of an €870 million convertible bond, which the company said will contribute to debt refinancing," said Standard & Poor's credit analyst Patrice Cochelin. "We expect the new convertible debt issue to further support Alcatel Lucent's liquidity following recent asset disposals."

We understand final terms are to be set in the coming days. Still, the size of Alcatel Lucent's upcoming debt maturities, and its low margins and significant cash burn remain negative credit factors in our view.

The lowering of the recovery rating on Alcatel Lucent's senior unsecured debt primarily reflects a shift in the company's debt structure, which leads us to expect a dilution of the value available to Alcatel Lucent's senior debtholders in a default scenario.

At June 30, 2009, Alcatel Lucent reported consolidated gross debt of €4.7 billion, including the equity component of convertible bonds.

The ratings on Alcatel Lucent remain constrained by our assessment of: the company's thin operating margins and negative free cash flow; intense competition in the telecom equipment sector, which creates ongoing and postly restructuring needs; expected declining demand for telecom equipment in 2009 that could trigger further revenue falls and post-restructuring operating losses for Alcatel Lucent; and the company's relatively sizable debt maturities through 2011.

The main ratings support stems from our assessment of Alcatel Lucent's liquidity as adequate, following recent asset disposals and the new convertible bond. The company's broad technology portfolio, client base, and geographic footprint also underpin the ratings.

Although the ratings incorporate our expectation that low margins and high restructuring costs will likely result in highly negative adjusted free cash flow in 2009, Alcatel Lucent's cash burn in first-half 2009 was larger than anticipated.

"We expect that Alcatel Lucent's cash burn will likely remain high in 2009," said Mr. Cochelin. "The negative outlook also integrates the possibility of a downgrade later this year or early in 2010 if our expectations for a recovery starting in late 2009 diminish or if Alcatel Lucent's restructuring plan does not successfully limit strain on the operating margin."

On the upside, with all other factors remaining constant, we could revise the outlook to stable were Alcatel Lucent to demonstrate that it is able to limit its cash burn while withstanding the current economic downturn. Improved access to consolidated cash balances for the parent company and debt-issuing entities could also help support rating stability.

 

[woolloomooloo]

Ce l'hanno fatta ad emetterlo il bond cv.

da quanto ho capito leggendo sulle 'nius' dell'azienda, è un bond in EUR con cedola al 5% e con 35% di premio sull'azione sottostante. scadenza 1 gennaio 2015 e convertibilità aperta da 1 gennaio 2011. quotato all'euronext dal 10 settembre.